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How To Apply For An SME IPO

An Overview

Small and medium-sized enterprises, or SMEs, are companies with assets, sales, or staff counts below a certain threshold. The standards for what constitutes a SME vary by nation and sector. The crucial role SMEs play in their economies has been recognized by governments all over the globe. The same is true for India, where SMEs have a substantial economic impact. SMEs make up about half of the workforce in India. Yet SMEs in India exhibit low productivity as a result of a number of problems. The largest problem an SME has is getting access to money, and money is also the main cause of its failure. Stay updated on the latest Upcoming IPO 2023!

Understanding SME-IPO

Before shares of a firm may be listed, traded, or exchanged, an Initial Public Offering (IPO) must be announced at a SME platform during an exchange. SME-IPOs are a very well-liked method for businesses to raise money from several investors and list on the stock market. Investors in SME-IPOs have reaped significant profits.

Some of the requirements for SME-IPO:

  • A paid-up capital worth ₹3 crore is required for the firm. The net value and physical assets have to be the same as well.
  • Businesses must be able to demonstrate distributable earnings for at least two of the three fiscal years before (excluding extraordinary income). This complies with Section 124 of the 2013 Companies Act.
  • According to SEBI regulations, the minimum trading amount for SEM IPOs varies between 100 to 10,000, based on the price class. Regular reviews and revisions are made based on how the pricing has changed since the listing.

How To Apply For SME-IPOs?

You may now use our apps to submit an SME IPO (small and medium company initial public offering) application using UPI up to a maximum of ₹2 lakhs. 

Here’s how to apply for SME-IPOs:

  • For a list of UPI applications for SME IPOs that have been authorized, click the link below.


  • You also be aware that the online application does not permit the direct sale of authorized shares underneath the SME category. 
  • For POA users, dial the customer service line immediately from your registered contact number and complete the sale of these orders by providing the necessary details, such as the number of units.
  • For non-POA individuals, the POA must first be engaged before the non-POA user may place a sell order.

Why Should Startups Care?

Now that we are clear on the definition of SME-IPO, let's examine its advantages. Due to the emerging class of mobile technology, social networks, and e-commerce firms making their debuts, the IPO market has indeed been taken by surprise all over the globe. The situation in the Indian market, however, is a little different.

Even though selling their products in India, businesses like Paytm, Snapdeal, and Flipkart chose to list abroad. SEBI believed that interested businesses would entirely disregard Indian investors after seeing this pattern. The Institutional Trading Platform has been established as a platform for entrepreneurs. Using The Institutional Trading Platform, a range of start-ups may now offer their shares and trade them without passing through the IPO procedure.

What Is An SME IPO in India?

In order to allow entrepreneurs to register on the SME platform and specify their prerequisites for net worth and profitability, SEBI is prepared to provide them leeway. The idea that greater possibilities should be given to small firms that are unable to list on the major board drove this action.

Many companies need funding to expand. Small firms have fewer alternatives than big startups, which have several options including enlisting the help of private equity investors to raise additional money. In this situation, a platform developed with such enterprises in mind would be very beneficial both for the companies and the investors.

The businesses listed on the SME marketplace are drawing more investors even as their influence grows. The growing number of SME stocks and higher returns are other factors contributing to a rise in the number of investors who engage in SMEs. With both the exchange board as well as investors providing such assistance, the Indian market appears to be favorable for SME-IPOs. These SMEs play a crucial role in India's economic development and expand job possibilities.

Wrapping Up

Now you have it: how to apply SME IPO. The whole process, from selecting a merchant banker to launching IPO shares, takes a long time and requires a ton of documentation. It is in your best interest as an investor to comprehend the IPO share listing procedure. Based on a preliminary assessment of market trends plus investor interest, the deal size and the issuing price are chosen. The equities trade like conventional shares after being listed, and their value changes according to market conditions.


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